The price of Bitcoin (BTC) falls below $20,000. The collapse of American banks affects cryptocurrencies. According to traders, the decline may continue in the coming days.
Bitcoin Price Tests Monthly Macro Range Low
Bitcoin price dropped to $19,592 today, March 10, 2023. At the time of writing, the cryptocurrency is trading at $19,963. Its price is currently recording a daily loss of 2.10%.
Trader Rekt Capital shared a chart showing Bitcoin “testing the low of its current monthly range” in the $19,973 to $23,303 range.
The trader recalls that there has already been a “pullback movement below this range” in the past. Therefore, this time, Bitcoin may continue to fall below this range. Rekt Capital even believes that turning $19,900 into resistance “might cause a crash.”
Banks in Trouble, Fed Still Aggressive
Bitcoin is experiencing a series of bad news in both new finance and traditional finance. Eight trading company founder Mikael van de Poppe talks about the shocks that have affected Silvergate, Silicon Valley Bank and First Republic Bank.
Mikael van de Poppe points out that “all these banks have fallen heavily in the markets.” The Eight founder compares the current situation to that of 2008.
The day was also marked by traders’ criticism of the US Federal Reserve’s (FRS) tightening of monetary policy. According to Mikael van de Poppe, the Fed’s policy is at the heart of “the fact that the Silicon Valley bank is on the verge of collapse.”
However, will the current context (eventually) push the Fed to stop raising the federal funds rate in order to prevent a large-scale financial and economic crisis? Fed Chairman Jerome Powell hinted this week that the next rate hike will be higher than expected.
Does this return below $20,000 mean a continuation of the crypto winter? 2023 began with a bullish rally that allowed the cryptocurrency to attack its 200-week moving average of around $25,000. After this bull run, the end of the first quarter looks to play in favor of the bears.